During lockdown, we got used to seeing empty high streets. Football was played in empty stadiums, and places such as London’s Oxford Street looked out of place without teaming crowds of shoppers and commuters.
Long after Covid-19 has been forgotten, it’s possible that streets around the world will be as empty – it not emptier. Why? Because a crash in fertility rates around the world means that the population in most countries will actually drop – in some cases by startling amounts. Some 23 nations – including Spain and Japan – will see their populations halve by the year 2100.
The population crash
A report last year by the University of Washington’s Institute for Health Metrics and Evaluation revealed that the global fertility rate nearly halved to 2.4 in 2017. Worse, they project it will fall below 1.7 by 2100, meaning that not enough people are born to replace those who have died. As the authors of the report wrote: “Changing population size and age structure might have profound economic, social, and geopolitical impacts in many countries.”
Amazing as it may sound, such a fall in fertility rates means that China, the most populous country in the world at present, will peak at a population of 1.4 billion mid-century, before halving to 732 million people by 2100. It’s hard to imagine right now, but the powerhouse of the global economy will shrink in size this century.
Japan’s population is projected to fall from a peak of 128 million in 2017 to less than 53 million by the end of the century. Italy, meanwhile, will see an equally dramatic population crash, from 61 million to 28 million over the same timeframe. It’s a slightly different picture in the UK, where the population is predicted to peak at 75 million in 2063, and then fall back to 71 million by 2100.
Crucially, these falls in fertility rates are being driven by more women in education and work, as well as greater access to contraception, leading to women choosing to have fewer children.
Why this matters…
You might wonder why this matters – it often seems the world is overcrowded already, and its precious resources are already stretched. If we are to address the climate change challenges the planet faces, surely fewer people living on it is a good thing?
Not really. Because on current estimates, the number of over 80-year-olds will soar from 141 million in 2017 to 866 million in 2100. As working-age people grow scarce, who will pay the taxes necessary to fund public services? Who will defend and protect the country? Who will fund and care for the masses of elderly people?
Economies currently rely on large numbers of younger age working people to work and support those in retirement. Social care for the elderly in the UK is widely acknowledged to not be fit for purpose and, despite pledges by multiple governments over the years, the situation remains unchanged. It wasn’t even addressed in the recent Queen’s Speech.
At present, most countries seek to control their borders and restrict immigration. Yet the report’s authors point out that this position will be reversed as competition for working-age people grows increasingly fierce. In fact, they imagine a scenario where countries may have to throw open their borders in order to attract the few remaining young people of working age.
A demographic shift on the scale imagined in the report would present severe challenges to society and business. The risk profile of a nation of elderly people would change dramatically, requiring a total realignment of emergency services, healthcare provision and access to public services.
Time for innovation
The challenges I outline here require bold thinking and frank conversations. But they should also prompt us to double down on investment in technology.
I wrote to The Times this week on the back of an article I read on a government proposal to examine the role of Artificial Intelligence (AI). I defended the use of AI and technology such as body-worn video, which is helping to keep retail staff safe. I argued that technology can and must come to the aid to these workers.
It is right that the government and the EU are looking at AI and how it is used responsibly. Many would say this scrutiny is overdue. But this should not stop us from developing new applications for AI that will make life easier as we head towards the demographic cliff edge.
A shrinking labour force will demand new and innovative ways of addressing current workloads. The automation of functions in retail, transport and logistics – from delivering parcels by drone to predictive maintenance regimes in automated factories – will not be a ‘nice to have’ – it will be essential. Many functions in healthcare are currently hard to automate, but AI is already being used to speed up the identification of cancer tumours while AI is powering virtual surgery.
And, as I have argued many times, law enforcement will have to rely more on technology to get the job done. The recently announced Biometrics Commissioner believes artificial intelligence will be an “inevitable” and “increasingly necessary component of policing”. It is hard to disagree.
Misplaced worries
Many commentators are concerned that automation will replace jobs. A 2017 McKinsey report estimated that up to 50% of jobs are “technically automatable by adapting currently demonstrated technologies” And that was nearly five years ago – consider the advances made since then!
I think these worries are misplaced. Robots are increasingly being seen as a way of augmenting people in the workplace, not replacing them entirely. Also, as global populations dwindle, the world will be a jobseeker’s oyster, as fewer workers will be available for the many roles that will remain impossible or inappropriate to automate. I can imagine many literally naming their price!
As an economy with what is predicted to be a stable population, the UK may have an economic advantage over many other nations in the future. Nonetheless, now is the time to plan for our future, imagine the art of the possible, continue to innovate and ensure our success.
